Manchester City aims to spark a significant revolution regarding the rules of the Premier League, which restrict the funding of its owners to compete for all titles. This move comes in light of new regulations that limit related party transactions by a slim majority. According to the British newspaper "The Times," Manchester City filed legal documents within days, preparing a substantial number of club-appointed lawyers to contest legal experts from the Premier League, in a case expected to cost clubs millions in shared fees.
The newspaper noted that Manchester City's actions threaten to ignite "civil war" in the Premier League, as the club's owners believe the related party rules affecting companies linked to the club's owners are illegal. They will seek compensation from the Premier League if they succeed in the anticipated arbitration session, which is expected to last two weeks and begins next Monday.
The report highlighted that Manchester City wants to tear up the Premier League’s rulebook. The documents submitted by the club prior to the hearing indicate that changing the rule requiring all related party transactions to pass a "fair market valuation" test is specifically designed to discriminate against owners. This rule was introduced as a direct response to Saudi-backed Newcastle's acquisition in 2021.
The newspaper explained that Manchester City’s position is that sponsors linked to club owners should have the right to determine how much they wish to pay, irrespective of any independent assessment, with the club's current sponsors including Etihad Airways and Abu Dhabi Telecom.
Other clubs with sponsors from related parties include Newcastle and Chelsea, both of which voted with Manchester City against changing the rule during a contentious shareholders meeting last February. The four-time reigning champions believe the clubs’ association has failed to enforce restrictions that allowed other clubs, notably Manchester United, to benefit from their financial superiority during the first 15 years of the league’s existence, considering that enforcing such rules now is another form of discrimination.
The newspaper disclosed that at least half of the twenty clubs in the competition will urge the court to dismiss Manchester City’s claims. Regardless of which side prevails, court costs will be substantial, as the Premier League's legal bills have already reached £20 million this year. However, if Manchester City wins the case and their compensation claim is assessed, this bill may significantly increase, as all these expenses will be deducted from broadcasting revenues and the prize pool to be shared among the twenty clubs.
